Airbnb Will Pay $250 Million to Hosts Impacted by Coronavirus Cancellations

UPDATE, March 31, 2020: Airbnb CEO Brian Chesky apologized to hosts impacted by Airbnb's coronavirus-related cancellation policy in an email, announcing that Airbnb is setting aside millions to help cover the costs of cancellations. Earlier this month, Airbnb expanded its extenuating circumstances policy, allowing guests who canceled reservations made between March 14 to April 14 to get a full refund. In response to the policy, hosts were upset that they weren't consulted and that they would be losing money.

They changed a policy for us without our permission. These were contracts with our guests. @airbnb had no right to change them. I’ve lost $4000 so far. We have bills to pay too! 100% of the cost shouldn’t be on the hosts!

Our lives r now ruined due to @Airbnb reneging on a mutually agreed policy. We've lost so much in cancellations on an already tight margin coming out of winter & investing our life savings into renovations & r expecting to lose much more. Why do hosts have to foot the bill alone?

In a video message to hosts, Chesky explains that expanding the extenuating circumstances policy after the World Health Organization declared the coronavirus a pandemic was not a business decision. Rather, it was decision based on protecting the public health. He then apologizes to hosts for not giving them a say in the decision. "I'm sorry we didn't consult you as partners, and I've heard from you since that decision. And what I've heard is that you want us to treat you truly like partners, and we want to fix this," Chesky said.

To help hosts losing money from the policy, Airbnb will pay them $250 million. According to the email from Chesky, when guests cancel accommodations due to coronavirus-related circumstances, Airbnb will pay hosts 25 percent of what they normally receive through their cancellation policy. The payments will be issued starting in April. Additionally, Airbnb is creating a $10 million relief fund for superhosts who rent out their own home and need help paying their rent or mortgage. The email from Chesky also includes an update to the extenuating circumstances policy, extending the cancellation window to reservations made between March 14 to May 31.

UPDATE, March 16, 2020: On March 15, Airbnb updated its coronavirus-related cancellations, expanding its "extenuating circumstances" policy to cover stays and Airbnb Experiences made around the world. Guests who cancel reservations made between March 14 to April 14 will receive a full refund. Hosts can cancel in that time frame without charge or an impact to their Superhost status. The only exception for the updated cancellation policy is domestic travel in mainland China, which will return to normal rules on April 1. The policy also won’t cover any new bookings. Airbnb’s expanded cancellation policy comes as the World Health Organization declared the coronavirus outbreak to be a global pandemic.

March 5, 2020: The novel coronavirus continues to spread around the world, causing people to postpone or cancel travel plans, especially to and from areas where the outbreak is severe. So what happens if guests need to cancel an Airbnb reservation due to COVID-19?

Typically, Airbnb hosts have the option to choose from six types of cancellation policies, ranging from flexible to strict. The “Flexible” policy allows guests to cancel until 14 days before check-in for a full refund. For the “Super Strict 60 Days” policy, guests can cancel at least 60 days before check-in, but they’ll only get a 50% refund of the nightly rate and cleaning fee. And they won’t get a refund for the service fee.

To prioritize the safety of its guests and hosts, Airbnb announced in a statement that it has activated its “extenuating circumstances policy” to offer impacted hosts and guests impacted by coronavirus the option of cancelling eligible reservations without charge. The extenuating circumstances policy usually covers cancellations due to death, unexpected illness or injury, government-mandated obligations, natural disasters, and transportation disruptions or cancellations, and unforeseen property damage.

While the extenuating circumstances policy also covers cancellations from epidemic disease or illness and travel restrictions imposed by a government, law enforcement agency, or military, Airbnb has a separate page, detailing which areas free coronavirus-related cancellations applies to. Right now, the policy covers reservations made in mainland China and South Korea. It also applies to guests traveling from those countries to Airbnbs in other destinations.

Other global scenarios include: having to comply with disease control restrictions implemented by government or healthy authorities, having to perform medical duties in connection with coronavirus, transportation cancellations due to coronavirus, and, of course, getting diagnosed with COVID-19.

According to Airbnb’s statement, the policy is being updated regularly, observing recommendations from the World Health Organization as well as government and health authorities. Track the cancellation policy updates here.